Concerns about the growth of cases of Covid-19 on Europe it is us United States did the Ibovespa (IBOV) abandon the recovery seen in the first weeks of October and move towards a negative closing in the month, amid fears that new “lockdowns” will affect the recovery of the global economy.
The caution before the US presidential election corroborated the more defensive bias. Although research points Joe Biden as a favorite, the re-election of Donald Trump it is not ruled out, just as financial agents fear a judicial outcome in the event of a very tight result.
In the background, there are expectations about more fiscal stimulus for the largest economy in the world, which have not yet come, in the view of many in the market, due to the dispute.
Amid this scenario, financial agents in the Brazilian market reflected a battery of corporate results for the second quarter, with many still reflecting the effects of the crisis triggered by Covid-19, but with the worst phase, apparently, having been left behind.
The behavior of prices in the country has also returned to the radar. The Central Bank recognized stronger inflationary pressure in the short term, but kept its forward guidance message and the door open for possible interest rate cuts ahead, while maintaining the Selic rate at 2%.
After September closing with the highest monthly volume of IPOs in the Brazilian market since 2010, October showed some dropouts, amid the most troubled environment in the markets. Still, another 15 companies applied for registration this month to go public, totaling 44 companies in the queue.
This Friday, around 4 pm, the Ibovespa registered a 3% drop, to 93,631.49 points, accumulating a 7% drop in the week, which led to a negative performance of 1% in the month. In the year, the decline is around 19%.
The Small Caps index also decreased by 3%, to 2,240.88 points, with a loss of 8.8% in the week and 2.7% month. In the accumulated for 2020, there is a decrease of 21%.
The volume traded on the floor on Friday totaled 22.6 billion reais.
Accumulated Ibovespa of the Month:
Csn (CSNA3) appreciates almost 24%, packed by the prospects related to the IPO of its mining unit, although the company has not yet decided if it will participate in the stock offering, in addition to the strong result of the third quarter and the horizon of further price increases of steel consolidate the good moment of the company.
path (WEGE3) accounts for an increase of about 16%, further expanding the earnings leadership at Ibovespa in 2020, with the result of the third quarter endorsing the view that the group has managed to overcome the crisis triggered by the coronavirus without major damage, while also working with recovery scenario in the most affected areas.
Santander Brazil (SANB11) rises almost 14%, in a month with bank recovery, despite some correction in the last trading sessions.
Santander Brasil surpassed its estimates for net income for the third quarter, helped by lower than expected treasury gains and losses on loans, while the return on equity was 21.2%.
Cvc brasil (CVCB3) accounts for a loss of around 24%, as new containment measures began to be taken abroad with the advancement of coronavirus cases, weighing even more on a sector already badly affected by the pandemic.
American stores (LAME4) decreased by almost 20%, continuing the negative trend since the end of July, after offering shares worth 10 billion reais. Its subsidiary B2W was also a negative highlight, with a decrease of 17%, amid movements in the realization of profits, even with the reduction of losses in the third quarter.
Irb Brasil (IRBR3) recorded a loss of almost 19%, without being able to leave the negative point of the Ibovespa also in the year.
The reinsurer seeks to regain credibility after a series of adversities this year, including accounting fraud. Monthly data has still shown a loss, although when excluding discontinued businesses it is already in the blue.
See the behavior of the main sectorial indices in the B3 (B3SA3) accumulated for the month:
– Financial index: -0.8%
– Consumption rate: -3%
– Electricity Index: + 1.3%
– Basic materials index: -6.25%
– Industrial sector index: + 1.6%
– Real estate index: -2.9%
– Public utility index: -0.4%